The use of competitor’s trademarks aiming to enhance results in search engines and sponsored advertisements has sparked controversy in several jurisdictions around the world. In Brazil, it has been witnessed an increase of cases involving enquires, extrajudicial notifications and court disputes.

Search engines as Google Ads sort the search results to prioritize a paying advertiser’s website over other possible results. An advertiser purchases the keywords with which it wants its website to be associated with and is also able to block others, among other possibilities.

The controversy involving search engines emerge from the practice of allowing an account holder to include a registered trademark keyword even if the account holder does not own the rights to that trademark.  Search engines usually (e.g., the use policies of Google Ads) do not check the trademark status of a keyword at the time of selection, but instead investigate claims of infringement only after receiving a complaint. Moreover, search engines may apply different policies to the selection of a trademark as a keyword depending on the region/country in which the trademark is registered.

In short, search engines may allow advertisers to promote and direct consumers to determined website via using keywords containing trademarks or trade names of third parties (including of competitors). The results usually appear at the top of a search page on the search engine because they have been sponsored or paid.

In Brazil, despite the still scarce number of rulings and absence of decisions from the courts of appeals and superior courts on the merits, in addition to the subjectivity in analyzing the matter, the courts position has been shifting (mainly in decisions vis-à-vis injunction orders) towards the understanding that the use of a registered trademark from a third party as keyword in search engines may, depending on the circumstances, be construed as a trademark infringement, and, ultimately, unfair competition.

Another common scenario which entails higher risks of a trademark infringement being characterized (based on the circumstance of misleading of consumers) occurs when, for example, Company XXX would hire a sponsored link for the expression YYY, which is already a registered trademark of the competitor. In this case, every time a consumer searches for the expression YYY it would be shown company XXX’s website first, many times accompanied by the expression ‘’buy here’’.

Within this context, and, mainly, while there is not a clearer outlining (via passing of legislation or maturing of the jurisprudence) of the requisites and parameters vis-à-vis such market practices, entrepreneurs shall keep special attention to the protection of its intellectual property rights against, depending on the circumstances, unlawful/abusive purchasing of sponsored links and/or keywords in search engines.

Even sales agents and/or authorized resellers, except when holding the express authorization for the use of third-party trademarks, may incur in infringement of intellectual property rights.

It is undoubtful that the use of search engines is essential in the development of a strong marketing strategy, however being required special attention to the scope of application of the protection granted by the trademarks law (Law 9,279/1996) and other applicable regulations.

In the age of smartphones, internet of things and cloud computing, it is no longer possible to imagine large parts of technology without software. Accordingly, many of the current innovations are made in the field of digital data processing and may have a minimum of one feature that is implemented using – at least partially – a computer program.

However, under the Brazilian Industrial Property Law (Federal Law 9,279/96), computer programs for data processing units as such are expressly excluded from patent protection. Thus, the fact that a data processing unit is controlled via a program to achieve a certain result is not sufficient for the program to be patented in Brazil.

On the other hand, patents for computer-implemented inventions are still allowed. Different from the protection of the software per se, a computer-implemented invention involves the use of a computer or other programmable apparatus, where one or more features are processed wholly or partly by means of a computer program.

On December 29^th, 2020, the Brazilian Patent and Trademark Office (INPI) published an updated version of the Guidelines for Examination of Patent Applications Involving Computer Program-Implemented Inventions. This updated version has been in force since January 1^st, 2021.[1]

The publication updates the former Guidelines and, among other matters, better define the scope of some terms such as “algorithm”, “computer programs”, “set of instructions” and “expression of a set of instructions”.

Another well received addition to the Guidelines relates to protection of datasets, a relevant feature in connection with Artificial Intelligence related inventions. Although the Guidelines establish that data structures per se are not considered an invention, it is outlined that a creation that uses or generates data structures may be considered an invention.

Some highlights from the new Guidelines also include detailed explanations about the non-patentable creations which comprise mathematical methods; business, accounting, financial, education, publicity, lottery, and supervision or auditing methods; diagnostic or therapeutic methods applied directly to a body; and the presentation of information, in the case when such techniques are implemented by a computer. The Guidelines also foresee exceptions to each of the existing prohibitions (hypotheses where a patentable invention would not be recognized), appointing that the restrictions are not absolute and can be circumvented under certain circumstances.

[1] Available at: < https://www.gov.br/inpi/pt-br/servicos/patentes/pagina_consultas-publicas/arquivos/2020_11_16___diretrizes_iic___versao_final.pdf >. Checked on September 30^th, 2021.

Patent Backlog

For many years, the INPI (Brazilian Patent and Trademark Office) faced a huge backlog of pending patent applications. Until few years ago, a patent application took at least 11 years to be granted, on average; and, depending on the technical field, the granting decision could take even longer.

Over the past 10 years Brazil has adopted several measures to remedy the situation, and, by the end of 2021, INPI estimates that 80% of the pending patent applications related to the backlog will be decided. Thus, by the end of 2021 the total time for completing the technical examination of a patent application is estimated to be reduced to 4 years from its filing date.[1]

Patent examination requires a complex approach, and, as examples, in England[2] a patent usually takes 5 years to be granted, while in Canada[3] it takes almost 7 years.

 The End of ANVISA´s Approval in Pharmaceutical Products Patent Applications

Federal Law 14,195/2021 entered into force on August 27^th, 2021, and, among other provisions, revoked Art. 229-C of the Brazilian Industrial Property Law (Federal Law 9,279/96), based on which the granting of pharmaceutical patents was subject to the prior approval of the National Health Surveillance Agency´s (ANVISA)  (for further information see here).

New Compulsory Licensing Rules for Patents

On September 2^nd, 2021, Bill no. 12/21 was sanctioned in Brazil, aiming at amending the provisions dealing with compulsory licenses set forth by the Brazilian Industrial Property Law (Federal Law 9,279/96) in cases of national or international emergency, as well as in case of public interest or recognition of public calamity.

The major differences from what was already provided by the Brazilian Industrial Property Law are those listed below:

• patent applications are also subject to compulsory license;
• the royalties are fixed as 1.5% of the net selling price of the product associated with the patent until its value is effectively established;
• Two-step compulsory licensing procedure: 1- the Brazilian Executive Power must publish, within 30 days of the state of emergency declaration date, a list of patents or patent applications related to essential products and processes that would help to counter such situation; and 2- After the publication of said list, the Executive Power will have a 30-day term, renewable for the same period, to analyze the inventions and utility models covered by the listed patents and patent applications. Compulsory licenses would then be granted, ex officio, for a specific period and on a non-exclusive basis.

(for further information, see here)

The End of the Minimum Patent Term

The Brazilian Supreme Court has concluded its judgment on article 40 of the Brazilian Industrial Property Law (Federal Law 9,279/1996), thus declaring on May 6^th, 2021 such provision was unconstitutional.

Pursuant to such decision, the INPI, upon granting of a patent, shall no longer apply the validity term extension, so that the concession privilege shall be limited to the validity terms provided by the heading of article 40, they are: 20 years counted from the filing date for patents of invention and 15 years for patents of utility model. The ruling had immediate effects and applies to all and any category of invention, embodying both the already filed applications awaiting analysis and new applications (for further information, see here).

[1] Available at: https://www.gov.br/pt-br/propriedade-intelectual/planos-estrategicos/plano-de-acao-inpi-2021-1.pdf/view; Checked on September 30, 2021.

[2] Available at: <https://www.gov.uk/patent-your-invention/before-you-apply>. Checked on September 30, 2021.

[3] Available at: < https://www.ic.gc.ca/eic/site/cipointernet-internetopic.nsf/eng/wr02462.html>. Checked on September 30, 2021.

In Brazil, all patent applications from the pharmaceutical and biotech areas were sent to the prior analysis/approval by the National Sanitary Surveillance Agency (ANVISA) instead of being exclusively prosecuted at the Brazilian Patent and Trademark Office – BPTO. Once the prior approval from ANVISA was published, the BPTO could proceed with the technical examination.

Until 1996, Brazil granted no patents for pharmaceutical inventions. In 1996, based on still in force Industrial Property Act (Federal Law 9,279/1996), pharmaceutical patents started to be accepted, but in February 2001 Federal Law 10,196/2001 formalized the intervention by ANVISA as a precondition for such patents granting, thus creating a burdensome procedure for such patent applications. Since then, several attempts to simplify such procedure and creating a more harmonic environment have been witnessed, with dozens of resolutions, manuals, adjustments and learning phases from both ANVISA and BPTO.

ANVISA – the equivalent authority in Brazil of the US Food and Drug Administration (FDA) and European Medicines Agency (EMA), was responsible for analyzing whether the subject of a patent application represent a health risk, through the protection of substances/products whose use is prohibited in Brazil.

In cases where the pharmaceutical product and/or process contained in the patent application were of interest to the Brazilian Public Healthcare System (SUS), the prior approval decision was also usually published by ANVISA accompanied by a technical opinion on patentability and other legal requirements. In such cases, ANVISA’s opinion was not binding and was considered by the BPTO as third-party observations.

Federal Law 14,195/2021, published on August 26^th, 2021, has put an end to this requirement of prior approval by ANVISA, measure received with great enthusiasm for the well awaited system simplification. On this direction, the BPTO had already published a communication stating the following:

• The flow of patent applications between the BPTO and ANVISA has been extinct since August 27, 2021;
• Patent Applications returned by ANVISA will have normal procedure at the BPTO after a specific publication in the Official Gazette;
• Requests concluded by ANVISA and sent to BPTO before the revocation of such compulsory prior approval have already been published in Official Gazette (section of RPI) nº 2763;
• The BPTO already received 1,284 applications that were on August 30^th, 2021 being analyzed by ANVISA;
• There are only 19 applications pending to be sent from ANVISA to the BPTO.

The House of Representatives (Câmara dos Deputados) in Brazil approved on June 29, 21 Bill no. 10,920/2018, proposed by congressmen Paulo Abi-Ackel (PSDB-MG) and Julio Lopes (PP-RJ). The purpose of the Bill has been enlarged throughout discussions in the floor of the House of Representatives and now aims at amending the Industrial Property Act (Federal Law no. 9,279/1996) to create a new provisional system and change some filing and examination procedures vis-à-vis patent applications, and to exclude requirements against international agreements adhered to by Brazil. The proposal now moves to the analysis and vote in the Senate.

Among others, the main changes in the Industrial Property Act encompassed by the Bill as passed through the House of Representatives are:

Foreign Attorney

Current Article 217 establishes that the person domiciled abroad must appoint and retain an attorney-in-fact who is duly qualified and domiciled in Brazil, and with powers to represent that person in administrative and judicial proceedings, including receipt of summons and service of process.

The Bill proposes a harmonization of such rule in cases of international treaties, such as the Madrid Protocol for the filing of trademarks. Accordingly, tackling both the need of harmonization but also the avoidance of unequal treatment to national and foreign applicants (the lack of a local attorney-in-fact would lead to difficulties by Brazilian litigants to file claims against such foreign applicants) a new paragraph would be included into Article 217 establishing a special rule where the foreign applicants will be exempt from the requirement, provided that if there is a lawsuit, the Judiciary shall notify the Brazilian National Institute of Industrial Property (BPTO), which will then notify the applicant through the World Intellectual Property Organization to present the power of attorney appointing such local attorney-in-fact within a 60-days term.

Simple translation

According to the Bill patent applications must be submitted in Portuguese and any other foreign language documents submitted along with the application may be in foreign language, being required only their simple translation, submitted at the time of filing the application or within sixty days thereafter.

This will apply to the specification, claims, abstract and drawings (if applicable).

Provisional Application

A new provisional application for patents will be created, which may help inventors gain time to perform research, proofs, and prototypes to improve their invention before submitting the definitive application to Brazilian National Industrial Property Institute (BPTO).

The BPTO must through regulations establish the conditions of the provisional application, which must comprise a clear and sufficient description of the invention and cannot claim priority from previous applications.

Within 12 months, the provisional application shall be converted into a definitive patent application. After such term, if the inventor does not apply for the conversion, the application will be withdrawn.

The conversion into a definitive application may not result in a patent application whose subject matter exceeds the provisional application and, the patent term, if the application is thus granted, will be counted from the date of the provisional filing.

According to statistics of the first year of validity of the Madrid Protocol in Brazil (up to September 30, 2020), national users have filed 109 applications for International Registration at the INPI (BRPTO – Brazilian Patent and Trademark Office). On the other hand, the number of designations received by INPI from foreign applicants exceeds 8,000 requests.

The Madrid Protocol, international treaty centrally administered by the International Secretary of the World Intellectual Property Organization (WIPO), relating to the international registration of trademarks, has been in force since April 1996 and was ratified by more than 124 countries representing more than 80% of world trade.¹

The Madrid Protocol came into force in Brazil on October 1^st, 2019, bringing several innovations to the Brazilian trademark registration system, facilitating the centralized filing and management of trademark applications by the brand owners in several countries.

The registration of trademarks from Brazil with the extension of its effects abroad has become quick and simple. Within the previous model, for instance, if a company would need to register its trademark in Colombia, China, Australia, USA, European Union, Mexico, United Kingdom, Canada and Japan, it would be necessary to engage an attorney-in-fact in each country, to incur in several fees, as well as to get involved in the implementation of several power of attorney instruments, translations and additional bureaucracy.

Now it is quite simple, for instance, to extend an already existing international registration to Brazil, besides enabling the centralizing in renewals management.

Other aspects of the Madrid Protocol are:

– With over 1.3 million trademarks registered, the Madrid Protocol is the preferred choice for international trademark registration among export-oriented brand owners;

– The possibility of the multiclass system: it allows the filing for all classes envisaged by the brand owner through one single application. In the case of Brazil, however, the analyzes will be carried out by class and upon payment of the full amount of charges for each requested class;

– International order system originated in Brazil: the INPI acts as the Office of Origin and as the Designated Office;

– There is no need to pay for translations nor to hire a representative in every country to which the extension of effects of a trademark is envisaged;

– Payment of one single set of fees to apply for trademark protection in multiple territories;

– The possibility of co-ownership;

– The division of applications became allowed and shall be done electronically upon filing the division may occur, for example, in connection with a suspended request.

Brazil has one of the world’s largest consumer market, with an overall population of 213 million as of 2021,² appearing as the largest economy in South America and as one of the largest of the world.

The ratification of the Madrid Protocol is embodied in a larger shift in focus by Brazil into the promotion of innovation, and the development of Intellectual Property and technology aiming at the country’s growth.

Checked on August 9^th, 2021. Available at: https://www.wipo.int/madrid/en/madrid_benefits.html#:~:text=With%20over%201.3%20million%20trademarks%20registered%2C%20the%20Madrid,brand%20owners.%20Convenient%20management%20of%20global%20trademark%20portfolios

Checked on August 9^th, 2021. Available at: https://www.ibge.gov.br/apps/populacao/projecao/box_popclock.php